International Bus Exam 1

Countries that receive loans from the IMF are required to

Adopt specific economic policies to attain stabilization

Who/What is affected: Workers

Argument for globalization: Development of better skills Arguments against globalization: Loss of jobs due to competition

Who/What is affected: Producers

Argument for globalization: More markets to sell in Arguments Against Globalization: Can go bankrupt due to competition

Who/What is affected: Consumers

Argument for globalization: More products to choose from Arguments against Globalization: Don't know how products are made

Who/What is affected: The Environment

Argument for globalization: Tougher laws led to lower pollution rates Arguments against Globalization: Lack of adequate regulations causes abuse

Econometrics studies show a hump-shaped relationship between income level and pollution levels. Which of the following statements reflect that relationship?

As an economy grows and income levels rise, initially pollution levels also rise.

Declining trade barriers

Better ability to export goods

Declining investment barriers

Better ability to optimize location economies

The IMF and World Bank were created in 1944 by 44 nations that met to maintain order in the international monetary system and promote economic growth

Bretton Woods: Institutions: IMF and the World Bank

What country in Latin America has seen a significant expansion in their economy in the past two decades?

Chile

The changing World Order

China

Many benefits that globalization has created a convergence in

Consumer taste preference

Bethany has been assigned the task of shipping all of the exhibit parts for the trade show her company is participating in to Germany. She works with a shipping company and has all the parts packaged together in a crate that will be lifted directly from the company trucks to the airplane. When the crate arrives in Germany it will go directly onto another truck and will be delivered to the convention center. What innovation in transportation is Bethany using?

Containerization

What is an accurate characterization of the role of international business investments in Latin America today?

Debt and inflation are down and foreign investment is welcomed

According to the UN Charter, one of the four purposes of the UN is to

Develop friendly relations against nations

The Changing World Output and World Trade Picture

Developing Countries

The labor, energy, land, and capital a country relies on to source goods and services are known as:

Factors of production

Morning Fresh Skin Care, a U.S.-based beauty products manufacturer, has set up a manufacturing plant in Hong Kong. This is an example of

Foreign direct investment

A series of treaties that reduced barriers to trade

GATT

Finance ministers and central bank governors of major economies coordinate policy on global financial crises

GTO

Simpson Manufacturing produces high-end kitchen appliances and currently sources component parts for these machines from fifteen different companies around globe. They use these sources to take advantage of lower costs. This demonstrates the idea of

Globalization of production

When compared to the past, the gap between rich and poor nations today has

Gotten bigger

Opponents to globalization believe that when U.S. companies outsource service activities, such as call centers, to a lower-cost foreign supplier, it results in

Higher unemployment in wealthy advanced economies such as the United States

The Changing Nature of the Multinational Enterprise

Hisense

Monique, a French fashion designer, sells her merchandise by exporting it to retail stores in the United States, United Kingdom, and Brazil. According to this information, Monique is participating in

International trade

Which best describes what place when a Chinese supplier of bicycle parts exports bike seats to Detroit Bikes?

International trade

For foreign direct investment (FDI) to occur, a firm should primarily

Invest resources in business activities outside its home country

What are mini-multinationals?

Medium-sized and small multinationals

Globalization critics argue that the decline in unskilled wage rates in advanced economies is due to the:

Migration of low-wage manufacturing jobs offshore

Sanjay purchased a computer for $500 in 2018. Compared to the $900 computer that he purchased in 2011, the new one seems better in terms of the price he has paid and the power of the microprocessor technology. This is best explained by

Moores law

Tomorrow's Tech Inc., a U.S. - based company, has productive activities in more than two countries. Tomorrow's Tech is what type of enterprise

Multinational

Boeing produced just 5 percent of its original 737 and 747 outside the United States but produces 65 percent of its newer 787 in foreign locations. Boeing's production strategy

Reflects the globalization of production

Which statement reflects a general implication of globalization

The COVID-19 pandemic called into question the wisdom of relying on globally production systems

A common complaint among those pushing back against globalization is that

The benefits of globalization are not evenly distributed among socioeconomic classes

Christian bought his son, Eric, a computer two years ago. Recently, he decided to buy his daughter, Brigette, a computer of her own. When applying Moore's Law to the two-year gap between the purchase of the computers, it is most likely that

The microprocessor in Brigette's computer wiukd be more advanced in terms of power than that of Eric's

The Changing FDI Picture

Toyota

As much as 70% of its work is devoted to establishing higher standards of living, full employment, and conditions of economic and social progress and development

UN

What country has seen a relative decline in its share of world output between 1960 and 2018

United States

Primarily responsible for policing world trade system

WTO

Detroit Bikes is located in the United States, assembles its product in the United States, but imports components from China and other countries. Which best describes Detroit Bikes?

an international business

The commercial jet aircraft market

can best be described as a global market

Boeing's 787 aircraft is produced by 50 suppliers spread around the world, a huge increase in global outsourcing as compared to the past. Boeing's strategy, like that of other multinational companies, suggests that

declining barriers to trade and investment are facilitating global production strategies

The minimum that a firm has to do to engage in international business is to

export or import products from other countries

What is the shift toward a more integrated and interdependent world economy called

globalization

Which best describes Detroit Bike's sourcing of components from other countries for assembly in the United States?

globalization of production

Enhanced communication technologies

growth in e-commerce

Enhanced transportation technologies

lowered distance between countries

During early globalization efforts, outsourcing was typically confined to _____ activities.

manufacturing

A major factor contributing to the frying of globalization since 2008 is

more regulations limiting credits

The growth of trade as a percentage of global GDP

reflects the globalization of markets

Fast food chain restaurants promote different menu choices in different countries depending on a range of factors such as demographics, local taste, income levels, and cultural values. This demonstrates that

significant differences still exist among national markets

One suggestion for helping poor countries enjoy the benefits of free trade is for richer nations to reduce barriers to importing products from those nations particularly for _____ agricultural products.

textiles

One advancement that has lowered the barriers many small firms face when buildings international sales is

the internet

Which socioeconomics group is feeling left behind in the age of globalization

the lower and middle class